Top VA Hospital Bosses Would See Pay Doubled Under Proposal To Congress

By Luke Rosiak – Department of Veterans Affairs officials want to double the pay of top administrators and move them into the same employment classification as medical doctors. They say the new, lucrative employment classification, Title 38, would help retain talent and make it easier to fire poor performers.

There is little evidence that either of these statements is true.

Private hospital administrators make more than the $180,000 most VA directors earn. But private sector hospitals are unlikely ever to hire from among career VA bureaucrats, most of whom have unremarkable qualifications, rose to management through tenure rather than talent, and benefitted from a closed pipeline that rarely hires from the outside.

Many have backgrounds in soft, unrelated disciplines, like social workers, who would be making an average of $54,000 outside of the VA. The Martinsburg, West Virginia, VA director has a background in facilities management.

For example, Stephanie Young, the head of the Illiana hospital in Illinois, only went to community college followed by an online B.S. from University of Phoenix. Manuel Davila, associate director of a Texas hospital, has a Ph.D., but all of his training, including undergrad, has been through online classes like University of Phoenix.

Others have only B.A.s or B.S.s from traditional schools. None would even be considered to run a private hospital, experts said.

The clearest evidence that VA hospital directors have no other job options is TheDCNF data analysis showing the lengths to which they will go to protect their $180,000 salaries, including uprooting their families and moving across the country four, five or more times in a span of a few years. (RELATED: Take a Ride on the VA’s Bad Bosses Merry-Go-Round.)

In the rare occasions when VA executives are fired, they typically fight it out, using appeal after appeal and launching lawsuits that divert agency officials to litigation when they could be focusing on making sure veterans are getting proper health care.

VA leaders will attempt Tuesday to convince senators to move its Senior Executive Service managers into the Title 38 system for medical doctors, which allows the government to pay significantly higher compensation. Agency officials say they are all but unable to fire bad SESers because of excessively complicated civil service rules and appeals to the Merit Systems Protection Board. Reclassifying VA’s SESers to Title 38 would fix that, according to officials.

Yet only weeks ago, the VA said it would take at least 270 days to fire a Title 38 employee who was drunk in the operating room, a length of time comparable to those involved in disciplining top SESers.

At the very time that Deputy VA Secretary Sloan Gibson is saying that paying hospital directors $400,000 would lead to better quality, he is dealing with a scandal in Cincinnati in which he singled out Barbara Temeck as a terrible director who needs to be fired and potentially criminally charged.

Temeck is a doctor who is being paid $400,000 as director. Yet even with all that money that should have attracted higher-quality candidates, Temeck’s colleagues in the network of VA executives repeatedly selected her, rather than outsiders, to run hospitals, even though every hospital she went to seemed to run into problems.

Veterans say they would be happy to have VA execs make private-sector salaries if it meant that VA would be run by an all-new slate of outsiders with prestigious backgrounds from private hospitals, but they have no confidence that that will happen. Instead, the move would amount to paying the same old people hundreds of thousands of dollars more.

Hospital directors are selected by their peers — either a panel of nearby VA hospitals’ directors, or by a regional director who is usually a former hospital director. They virtually always select from among that same group — appointing a career VA executive with whom they have long worked.

“Bringing a different perspective in from the outside is generally the best way to change a broken system,” said Paul Esselman of Cejka Executive Search, which for 35 years has done nothing but search for hospital CEOs.

VA spokesman James Hutton would not say if VA has ever used the techniques to recruit a CEO slot at higher-paying hospitals such as retaining an executive search firm to scour hospitals and tap networks like the Wharton School of Business.

Hutton refused to say whether any VA directors have ever run private sector hospitals before or after their stints in government.

Russ Carnahan, a former Democratic congressman from Missouri whose local hospital has had a rotating cast of interim directors for years, said “throwing money at the problem is not going to fix it.” VA has to “address the less-than-good talent that’s there.”

The higher pay is pitched by saying that high-quality people won’t work for $180,000, yet directors’ jobs would not be recompeted, so massive pay boosts would go to people who are, by the department’s own logic, less qualified. Eventually turnover will take care of that, but the bigger problem is that there is no reason to think those making hiring decisions won’t continue to appoint lifelong VA employees who they know into these positions.

“It’s perpetuating people that are in the system where you don’t have openings for new talent to get in the system,” Carnahan said.

For months, the VA strongly opposed congressional efforts to remove endless appeals for top-level executives found to have engaged in misconduct. But then uddenly VA agreed that it was necessary and proposed its own plan–that would have the side effect of doubling pay. Officials later admitted that increasing pay was the real goal, and it had been in the works since before Congress sought to streamline discipline.